Two different sites on vitamin K-dependent gamma-glutamyl carboxylase (VKC) are involved in enzyme-substrate interaction: the propeptide-binding site required for high-affinity substrate binding and the active site for glutamate carboxylation. Synthetic descarboxy osteocalcin (d-OC) is a low-K(m) substrate for the VKC, but unique since it possesses a high-affinity recognition site for the VKC, distinct from the propeptide which is essential as a binding site for VKC. However, the exact location and composition of this VKC-recognition domain on d-OC has remained unclear until now. Using a stereospecific substrate analogue [t-butyloxycarbonyl-(2S,4S)-4-methylglutamic acid-Glu-Val (S-MeTPT)] we demonstrate in this paper that the high affinity of d-OC for VKC cannot be explained by a direct interaction with either the active site or with the propeptide-binding site on VKC. It is shown using various synthetic peptides derived from d-OC that there are two domains on d-OC necessary for recognition: one located between residues 1 and 12 and a second between residues 26 and 39, i.e. at the C-terminal side of the gamma-carboxyglutamate (Gla) domain. Both internal sequences contribute substantially to the efficiency of carboxylation. On the basis of these data we postulate the presence of a second high-affinity substrate-binding site on VKC capable of specifically binding d-OC, which is the first vitamin K-dependent substrate of which the VKC binding domain is interrupted by the Gla domain.